Day: November 28, 2019

Shanghai-based SOSV Chinaccelerator has announced nine startups to present their businesses on its 16th Demo Day. Chinaccelerator is the accelerator from China that aims to bridge China and the rest of the world, especially Southeast Asia, through sharing entrepreneurship and innovation lessons learned from the China market and bringing International methodology and best practices to China.

The accelerator claims that it has invested in over 150 startups from over 25 countries, which among many are from Southeast Asia and still running their business well in the region.

Among 9 startups in this batch, 4 startups are located in Southeast Asia or targeting Southeast Asia and two AI startups are from Hong Kong. Here are six out of the nine startups:

1. Angat, a tech remote hiring startup that enables companies to source, hire, and manage tech talent via remote tech hubs location in countries with strong, untapped IT talent such as the Philippines. The startup is based in the Philippines.

2. viAct.ai, a Hong Kong-based computer vision-powered startup that automates the real-time monitoring of construction and manufacturing sites to increase productivity and safety.

3. HomeCrowd, Malaysia-based digital mortgage crowdlending platform that uses a holistic credit scoring system to help underserved populations get access to mortgage and debt consolidation loans. HomeCrowd is the first company in Malaysia to be licensed for mortgage and consumer lending by the Housing Ministry.

Also Read: How to start a business in China as a foreigner

4. Neufast, Hong Kong-based startup that utilises AI technology to help hiring managers reduce time-to-hire, eliminate unconscious bias, and evaluate job fit scientifically, by providing companies with personalised question-answer interview bots and video-based psychometric assessments.

5. Tourplus, Malaysia-based online travel marketplace that connects travelers with thousands of local guides in Southeast Asia. Tourplus’ platform offers personal itineraries with local guides and transportation in real-time.

6. TravelFlan, Hong Kong-based AI-enabled platform that helps companies to sell travel services. TravelFlan unlocks flight, air, hotel, and experience booking revenue for super apps through its personalised chatbot travel engine targeted at customers in China, Japan, Korea, and Southeast Asia.

7. Travelright, a travel tech startup that provides an intelligent flight compensation solution for Chinese travelers to quickly and easily claim owed by airlines for flight delays and cancellations.

8. GetKno, a real-time analytics platform for brands, factories, and workers that allows brands and factories to scale ethical manufacturing and increase productivity.

9. Voilà!, a social commerce platform enabling US fashion KOLs and micro-influencers to monetise through e-commerce personalized with Voilà!’s visual search engine and product recommendation algorithm.

Also Read: Why China should be the next market for your startup or scaleup

Chinaccelerator is operated by the venture fund SOSV, which operates seven global accelerators. Chinaccelerator offers three months of guidance, training, and resources from mentors, partners, and investors with access to supportive alumni network

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Photo by Adi Constantin on Unsplash

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Grab just launched online motorbike ride in Malaysia [Katadata]

Despite being established in 2012, decacorn Grab just announced that it finally kicked off the online motorbike ride operation, or known as ojek. The announcement came with the recent move by Gojek that also applies for operation permits in Malaysia.

Earlier this month, according to Katadata, Malaysian government announces the proof of concept stage for online motorbike ride operation in the country. The program will be done in Lembah Klang, Malaysia for six months before the operation commences in 2020.

The company said that the ride-hailing service will also cover food delivery, known as GrabFood.

Malaysian private investment firm RHL Ventures launches accelerator programme, to identify, scale Malaysian businesses [Press Release]

Malaysia-based private investment firm RHL Ventures announces that it has launched an accelerator programme with the mission to identify and scale Malaysian business.

“Our new accelerator programme underlines our firm’s stronger refocusing of efforts to grow Malaysia’s entrepreneurial and investment ecosystem along more sustainable lines,” said Rachel Lau, Managing Partner of RHL Ventures.

Also Read: Insurtech NTUC Income joins hand with Chinese insurer ZhongAn for Singapore scaleup

“With Malaysia’s innovation landscape now being more vibrant and dynamic than ever before, we are looking forward to identifying and work with the country’s best and most forward-thinking businesses – helping them to scale their innovations and grow them to become local and global champions.” Lau continued.

RHL Ventures earlier this year announced that it would raise a US$24 million fund to support the growth of local SMEs. The company also has several homegrown technology firms in its investment portfolio; including healthcare software company HealthMetrics, healthy snacks e-commerce platform Signature Market, and online interior design marketplace Atap.co.

WeWork expands to Vietnam, opening two new locations in Ho Chi Minh City [Press Release]

Global co-working space and startup community network WeWork announces the upcoming opening of its second and third locations in Ho Chi Minh City, Vietnam, respectively at Sonatus, opening in November 2019, and Lim Tower 3, opening in February 2020.

Branching out from E.Town Central, WeWork’s first location in District 4, the two new WeWork locations are located in District 1, HCMC’s central district. Sonatus is situated downtown at 15 Lê Thánh Tôn, Bến Nghé Ward, while Lim Tower 3 is at 29A Nguyễn Đình Chiểu in the hip Da Kao Ward.

WeWork has established a strong presence in Southeast Asia over the past two years, since opening its first location in Singapore in 2017. It now boasts footprints in Vietnam, Singapore, Indonesia, Malaysia, Thailand, and the Philippines.

Carro partners NTUC Income, launching on-demand driving insurance [Press Release]

Carro, Southeast Asia’s automotive marketplace, partners with NTUC Income to enhance the company’s car subscription service. The new usage-based car insurance between Carro and NTUC Income is via a ‘pay-as-you-drive’ model that is based on how much the user drives the car; the less they drive, the less they pay.

From November 28 this year, all Carro car subscription customers will benefit from insurance savings via subscription credits based on how much they drive. Carro’s subscription packages include 1,500 kilometres of mileage per month for every standard subscriber. With this usage-based insurance scheme, subscribers will get charged only for the kilometres driven each month, and the rebates for the un-driven distance will be used to offset the subscription fees for the next month. Rebates for un-driven distance can be as high as over US$800 per annum.

Also Read: Automotive marketplace Carro adds US$30M to Series B round; acquires Indonesia’s Jualo.com

The new insurance service uses Vehicular Telematics to assess how much each of their cars is driven in a single month. This data accurately determines the exact premiums, down to the kilometres driven and charges the customers accordingly for the month.

Carro’s subscription model offers all-in flat monthly charges starting at US$1,024 that covers insurance, road tax, regular maintenance, and 24-hour assistance.
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E-commerce companies Shopee and Lazada are competing for the top spots in the Southeast Asian (SEA) market, according to the new The Map of Southeast Asian E-Commerce – Q3 2019 report.

Published as a result of a collaboration between iPrice Group, App Annie, and Similar Web, the report saw the two companies vying for the top spot in different categories.

Both companies top the category of mobile apps with the highest number of monthly active users (MAUs) in Q3 2019, where Lazada ranks first in four out of the six SEA countries that are being researched: Malaysia, the Philippines, Singapore, and Thailand. Shopee itself tops the list in Indonesia and Vietnam.

Another top player in the region that made it to the list was Tokopedia, which followed Lazada and Shopee in categories such as mobile apps with most MAUs and downloads.

In its home market Indonesia, Tokopedia is the most visited e-commerce websites in Q3 2019 at 25 per cent of web traffic market share. In this segment, Tokopedia is followed by Shopee at 22 per cent.

Also Read: Singapore: The new “place to be” for e-commerce in Asia?

What we learned this quarter

The report also offered insights into trends that are displayed by e-commerce companies in SEA in Q3 2019.

It said that nine out of 10 applications with the highest number of MAUs offer products in multiple different categories, instead of just focussing on one vertical such as fashion or electronics.

“This shows that multiple-category marketplace platforms may be the future of Southeast Asian e-commerce due to convenience and their strong financial backing,” the report elaborates.

Another trend that the report pointed out is the rise of “shoppertainment” –a concept that includes the addition of features such as live streaming events and in-app games to increase user engagement.

Another interesting development in Q3 2019 is the apperance of newcomer Wish in the main categories.

A cross-border commerce app, Wish made it to the top five most downloaded mobile apps for the first time. According to the report, this indicated the platform’s serious foray into the Southeast Asian market.

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Image Credit: Markus Spiske on Unsplash

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Last year, the Asian mobile gaming market hit a revenue mark of over USD$41.5 billion. Japan, for instance, emerged among the top 3 digital gaming markets globally with revenue of over USD$19.2B in 2018.

According to Cam Pham, a blockchain researcher, 2020 could just be as lucrative especially thanks to blockchain technology.

With the planned inclusion of eSports into the 2022 Asian Games, the gaming boom in Asia is set to increase especially with blockchain capacity to enable fungibility of virtual gaming items.

Yat Siu, the co-founder, and chairman of Animoca Brands believes that the mass adoption of the blockchain industry will come through games.

In his opinion, “gaming has been an industry that has pushed forward technology in general.”

South Korea

Perhaps nowhere else in the world is a blockchain gaming set to succeed more than in South Korea.

Also Read: Singapores gaming chairs startup Secretlab gets funding from Temasek’s Heliconia Capital

With only 1 per cent of the global population, the country boasts of upwards of 30 per cent of the world’s cryptocurrency trading platforms.

What’s more, in 2018, the Korean government legitimized the blockchain and cryptocurrency industry with a move to draft industry classification standards that “recognizes crypto exchanges as regulated financial institutions.”

On this backdrop, giant South Korean tech companies have established platforms such as ONEStore that offer users access to decentralized blockchain-based applications like BUSKON.

However, despite last year’s move, the stance of the South Korean government on blockchain and cryptocurrencies is still unknown.

Just recently, the South Korean regulators, banned Infinity Star (a game that uses an Ethereum ERC721 token). Although the regulatory body insisted that the decision was not a total ban on games that use blockchain technology, onlookers and industry insiders believe that the move could spell doom for the industry.

Japan

In Japan, regulation seems to be taking a blockchain-friendly turn. The Japan Cryptocurrency Business Association (JCBA), a self-regulatory organization, last month released guidance for cryptocurrency custody operators. 

The guidelines stipulated the various responsibilities of cryptocurrency custodians and also suggested a virtual currency ranking that would ensure the safe handling of cryptocurrencies based on their specific characteristics.

According to Tran Ngoc Son, the CEO of Tomochain in Japan, “ownership and liquidity of virtual items are the current problems” facing blockchain gaming. 

With the new guideline, developers will now be able to comply with regulations while coming up with blockchain-based games that allow players to have greater control of in-game assets. 

With a revenue of $19.2B in the digital gaming market, Japan stands as one of the leading blockchain gaming markets with apps like My Crypto Heros (MCH) boasting the largest number of users in the world.

According to Kazuhisa Inoue, the CEO of Good Luck 3, “gaming and gaming economies offer a perfect fit for the circulation of tokens.” Inoue is the game maker behind CryptOink,  a blockchain-based game with crypto piggies that recently attracted 20,000 gamers. It is similar to Cryptokitties, but with more racing options, ie. gamers race, bet, breed pigs and compete in challenges. 

China 

While the rest of Asia embraces the gaming boom, the Chinese government is putting in place so-called “game-changing” laws that target more than 170 million minors online. 

The new law restricts playtime and instils spending limits for the country’s 20 per cent of its online users aged between 8 and 16 years old.

This comes at a time when Reality Gaming Group, a London-based blockchain, and AR gaming startup, plans to accelerate the development of its platform as well as other blockchain and AR games after signing a Memorandum of Understanding that gives it access to the Chinese market.

Although China is known for its harsh stance on cryptocurrencies, recent comments from Chinese President Xi Jinping show a blockchain-friendly viewpoint. 

In an article published last month, Chinese President Xi Jinping said that “major countries are stepping up their efforts to plan the development of blockchain technology.” 

He further added that China should put in “greater effort to strengthen basic research in the field and boost innovation.”

Hong Kong

In Hong Kong, political unrest is fuelling the popularity of an Ethereum-based game called Gods Unchained.

The popularity of the blockchain-based card trading game spiked after revealing its stance on Chinese censorship when Blizzard (the company behind Hearthstone) expelled a gamer who showed support for the  Hong Kong protests in an interview.

Although Blizzard later reduced its punishment on Chung Ng Wai (Blitzchung), Gods Unchained moved quickly to speak against Blizzard’s actions even promising to refund Blitzchung all his rescinded earning from Hearthstone.

Also Read: 3 top mobile gaming trends by Outblazes Yat Siu

With Hong Kong as the centre of pro-democracy protests, the popularity of God’s unchained increased to an extent where the transfer count of its token peaked past the previous high set by Cryptokitties.

Looking forward and beyond

Not only are there more people engaging with digital games, but gaming in Asia is also educating more people about the value of virtual assets and the power of blockchain technology.

Blockchain technology is solving the problem of scarcity of in-game items making gaming even more lucrative in the long run. However, it’s not all smooth sailing in Asia. Despite the positive stance that countries like Japan show towards blockchain and cryptocurrency, the volatile nature of regulation persists in places like South Korea and China.

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Everyone is talking about neobanks (alternatively known as hybrid banks or in the UK, challenger banks). In 2018 alone, consumers saved USD$5 billion by using neobanks rather than going through traditional avenues. That’s a lot of cash. Sure, neobanks are seen as “disruptors,” but they also may help with business growth and individual finance. The question is, are they the future of banking? 

Traditional banking route

Going through the traditional lending process has historically been the only route for small business owners and individuals to obtain a loan. There has been limited competition and let’s face it, slow processes that seemed to be accepted because it was simply the way things were done. 

For the bigger banks themselves, lending to small businesses especially was tough. Smaller loans, yet the same amount of paperwork and manual processes required for bigger-value loans. The smaller ones seemed unprofitable and perhaps that’s why neobanks have seen such a recent surge over the past 3 years.

Introducing neobanks

To date, Americans have opened approximately 3.25 million accounts with US-based neobanks. Just under USD$1.7 billion is held in these accounts. This equates to around 0.014 per cent of all deposits held in US banks. While this may not seem like a large disruption to the traditional bank route, they are definitely making waves. 

Also Read: Fintech and banks: collaboration or competition?

Neobanks tend to share a few characteristics such as offering microloans and fast digital customer experience. Their low-cost structure minimizes overdraft and monthly fees. However, as a result, customers tend not to earn that much interest on their deposits. And finally, for the budget-conscious customers, there are often budgeting and savings tools built into accounts so consumers can automate their financial transactions, which leads to better savings habits. 

Neobanks is definitely surging in popularity, and are certainly making headlines. In fact, in 2018, neobanks in America received four times as much funding as they did in 2017 and ten times as much funding than in 2015. While neobanks first found their home in the UK, mainly because the UK market isn’t as saturated with big banks like the US, they are popping up worldwide. So why are they gaining popularity at such speed?

The neobank success

For starters, unlike traditional banks, neobanks aren’t burdened by cumbersome systems and organizational structures. As well as this, because they tend to offer niche services, and certainly don’t provide the full banking experience, there are fewer regulatory requirements. 

For many neobanks, it’s about helping consumers lead healthy financial lives by providing helpful products and services with fewer fees. Banking is quick and simple. There’s no need to book an appointment at a banking branch and no need to fill out lengthy forms to set up an account. 

For the customer, there’s a seamless and useable platform to use and are changing the way people save and spend their money, with real-time updates on spending, transfers and incoming money, and the ability to send money through to friends using merely their names or contact numbers. 

Another bonus that comes with neobanks is the ability to save in a smarter, more user-friendly way. For example, many platforms will allow you to partition your savings into specific buckets that are kept separate, so if you’re saving for a holiday or a house deposit, you can allocate your funds accordingly. 

It’s a handy feature for the younger generation, and as an added bonus, it helps keep track of where the money is going. However, the traditional banks are taking notice, and some are even adopting the same techniques in order to retain their customers and encourage new ones. 

Some of the bigger banks are launching side projects of their own. One notable example is Goldman Sachs which launched a digital retail offering called Marcus by Goldman Sachs. 

JP Morgan is also chasing the neobank tail with Finn by Chase which is a completely digital bank, targeting the younger generation and those who live in areas of the US with a shortage of physical bank branches.

Will they last?

Sure, neobanks are shining at the moment, but not all shiny things last. They’re on the rise but it’s questionable whether they will fully overtake traditional banks, especially anytime soon. 

The traditional sector connotes a kind of trust that newer, challenger and neobanks simply don’t have at the moment. Second, the traditional banks offer a full-service model, whereas many neobanks rely on one particular niche area of service, such as debit cards. 

Also Read: Threat or opportunity? boosting digital banking in Asia

Most neobanks are enjoying success with the younger generation. Yet it may be too soon to tell whether the millennial customer base will remain with a digital-only bank. Are neobanks offering enough to take their younger demographic into their middle and older years? 

Neobanks are certainly transforming consumer banking and small business lending, it may be too early to tell whether they’ll survive. 

While people are certainly turning to neobanks to help them save, avoid fees and enjoy quick and simple banking, perhaps there’s still room for both traditional and challenger banks in our future.  

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